Sarepta Therapeutics, Inc.

Good afternoon and welcome to Sarepta's second quarter 2026 earnings results call. As a reminder, today's program is being recorded. At this time, I'll turn the call over to Pam Thornton, Sarepta's Senior Director of Investor Relations. Please go ahead.

Thank you.

And thank you all for joining today's call. Earlier this afternoon, we released our financial results for the second quarter of 2026. The press release, along with our slides and supplementary information, are available on the investor section of our company website. We plan to file a Form 10-Q for the quarter today with the SEC. Joining me on the call are Michael Severino, our CEO, Dr. Louise Rodino-Klapac, President of R&D and Technical Operations, Patrick Moss, our Chief Commercial Officer, and Ryan Wong, our Chief Financial Officer. Additionally, joining us in the Q&A portion of the call are Ian Estepan, President and Chief Operating Officer, and Dr. James Richardson, Chief Medical Officer.

Before we begin the formal remarks, I would like to note that during this call, we will be making a number of forward-looking statements.

Please refer to slide two of our presentation to view the formal text of these safe harbor statements. These statements involve varying risks and uncertainties, many of which are beyond Syrepta's control. Actual results can materially differ from these forward-looking statements, and such risks and Adversity Affect Our Business are Results of Operations in the Trading Price with Sarepta's Common Stock. We strongly encourage all listeners to review the company's most recent SEC filings for a detailed description of these applicable risks. Sarepta explicitly states that it does not undertake any obligation to publicly update or revise its forward-looking statements or financial projections based on subsequent events. Furthermore, please note that we will discuss non-GAAP financial measures during today's webcast. Complete descriptions and reconciliations of our GAAP to non-GAAP financial measures are included in today's best release and the accompanying slide presentation available to investors on our website. And with that, I will now turn the call over to our CEO, Michael Severino.

Thank you, Tam. Good afternoon, and thank you for joining Sarepta Therapeutics This is my first earnings call as CEO of Sarepta, so today I'll offer a few opening remarks and then turn things over to Patrick, Louise, and Ryan to discuss our commercial highlights, pipeline progress, and financial results for the quarter in more detail. As someone who has spent a career evaluating preclinical and clinical data and translating scientific breakthroughs into meaningful treatments for patients, It's an honor to be here. Sarepta is uniquely positioned within Biotech and has tackled some of the most challenging problems in medicine. Our scientific achievements have helped redefine what is possible for patients with Duchenne, from pioneering work in exon skipping to the development of Alevitus. A growing body of long-term data has established Sarepta as a leader in rare disease innovation. I see tremendous potential untapped value in the opportunity we have in front of us, and that is what brought me to be a part of this team. We have a leading commercial portfolio in Duchenne, with four approved therapies that are making a difference for patients today. These therapies are backed by a growing body of long-term data and real-world evidence supporting their use. We have an siRNA platform that has already delivered strong preclinical and early clinical data. As a physician scientist, I find these data compelling and have been impressed by both the potency of our siRNA constructs and our ability to deliver to the cell type of interest with high efficiency, as evidenced by our ability to achieve high muscle concentrations in a dose-dependent manner in our SAD studies. Based on these features and the strong predictive value preclinical models have in this space, I believe our pipeline has the potential to deliver best-in-class therapies across multiple neuromuscular and rare disease indications and drive our next phase of growth. Importantly, we have the financial strength to advance these programs independently, and we have a deeply experienced and talented team with a strong track record of delivering results. We recognize that concerns around elevitous adoption Competition on the horizon for exon skipping treatments and capital allocation remain. However, we are prepared to meet these challenges and have multiple upcoming milestones that can clarify our growth trajectory. These include Cohort 8 data, new data in the second half from two of our most advanced SIRNA programs in FSHD and DM1, and upcoming regulatory decisions around Biondus and Amondus. Now, turning our attention to the quarter. You will hear more details from Ryan shortly, but I'd highlight three things from our quarterly financial results. First, we delivered another quarter of gap and non-gap operating profitability, reflecting the durability of our base business and disciplined execution. Second, we increased cash and investments by approximately $197 million during the quarter, strengthening our ability to fund future growth. And third, Our commercial portfolio continues to provide a strong foundation as we invest in what we believe are significant long-term value and growth opportunities across our emerging SI RNA pipeline. Commercially, our PMO franchise has remained stable and 11 is performed in line with expectations with improving enrollment forms providing early evidence that our expanded commercial initiatives are taking hold. Thank you for joining us. We continue to make meaningful progress across both our Duchenne and SI RNA programs. In Duchenne, enrollment and dosing continue in cohort 8 of the ENDEAVOR study, and we expect to fully enroll the study by the end of 2026. We were also pleased to see the FDA accept our supplemental NDA submissions of Amondus 45 and Biondis 53 for review. Beyond Duchenne, our emerging siRNA platform remains central to Shrestha's future growth strategy. With important data readouts expected later this year from our FSHD and DM1 programs, Louise will discuss the biology-first approach that underpins these programs and why we believe our platform can deliver differentiated, potentially best-in-class therapies across multiple rare disease indications. Thank you, Patrick.

Thank you, Mike, and welcome to the team. Today, I'll review our second quarter commercial performance, the progress we are making to support physicians, patients, and families across our four approved Duchenne therapies, and our outlook for the remainder of 2026. For the second quarter, total net product revenue was $329 million, consisting of $98 million from Elevitus and $231 million from our PMO franchise. PMO performance continues to reflect stable demand and sustained patient and physician confidence, supported by extensive real-world experience and evidence. Eleventus performance was in line with our expectations for the quarter, with sales remaining relatively steady and quarter-over-quarter growth in enrollment forms signaling that demand is increasing. We view that trend as an encouraging sign that momentum is building. Our focus is on sustaining that progress and supporting informed treatment decisions through continued science, education, and engagement. Throughout the first half of the year, we completed the expansion of our commercial footprint. The strategy is set, our sales team is trained and deployed, and our initiatives are now fully operational. Our focus is now on execution, improving patient identification, expanding education for patients and families, and continuing to strengthen healthcare providers' confidence to drive demand. At a recent mid-year meeting, the energy across the team was clear. They are reaching more referring physicians, engaging more deeply at treatment centers, and participating in a more balanced discussion about the totality of evidence demonstrating a Levitas' benefit-risk profile. In Q2, our sales team delivered a record number of healthcare provider interactions. HCPs are engaging more deeply on the sustained functional outcomes and durability supported by Elevitus Embark Part 2 and, more importantly, the three-year data. Enrollment form activity provides early evidence that these efforts are taking hold. A majority of Q2 enrollment forms were from HCPs who had interacted with our sales team in the prior 90 days, including a meaningful portion within 30 days. This pattern was consistent with Q1 and reinforces the importance of focused, timely engagement. The breadth of site activity expanded in Q2 as well, through both re-engagement and new interest. More returning sites submitted enrollment forms than in Q1, while submissions from referral sites outside our current network signaled broader interest in 11S. Taken together, these indicators support our view that our sales team initiatives are taking hold. Understanding of the Elevitus Benefit Risk Profile is improving, and confidence is rebuilding across the Duchenne community. In addition, our patient education team is bringing that same commitment directly to families, connecting with many who have turned to Sarepta seeking information that will help them navigate Duchenne and the treatment decisions they face with greater clarity and confidence. Turning to our outlook, as Mike mentioned, Consistent with our previous directional model towards the lower end of the $1.2 to $1.4 billion range, we are narrowing our 2026 total net product revenue guidance to $1.2 to $1.3 billion. The timing of revenue reflects how patients progress from enrollment form through the treatment journey. Elevitus revenue in the first half of 2026 was supported by patients who entered the pipeline following the late 2024 label expansion, and progress to infusion during the first half of the year. As a result, first half revenue benefited from the conversion of that backlog of demand. Elevitus revenue in the second half of 26 will reflect a period when enrollment form activity was lower before expanded commercial initiatives were fully deployed and beginning to take hold. We are encouraged by the quarter-over-quarter improvement in enrollment forms we are seeing today. However, Thank you for joining us. We do remain confident in the long-term opportunity for Elevitus, and our team remains focused on sustainable execution. Now, turning to our PMOs. Stable demand, extensive real-world experience, a well-established safety profile, and adherence rates exceeding 90% continue to underscore the durability of this business. More than 1,800 patients worldwide have been treated with Sarepta's exon-skipping therapies, underscoring their enduring value to patients and families. This year marks an especially meaningful milestone for Sarepta and the Duchenne community. On September 19th, Exondus 51 will celebrate 10 years since its U.S. approval. For us, this is more than an anniversary. It represents a decade of Sarepta's leadership, close partnership with the Duchenne community, and progress that has helped us transform the treatment landscape. Over that time, Sarepta has helped establish exon skipping as a foundational treatment approach and built a substantial body of real-world evidence across important outcomes, including ambulation, pulmonary function, cardiac function, and survival. We are proud of the progress made over that past decade and deeply honored to have served the Duchenne community throughout that journey. In closing, our priorities remain clear. Execute with discipline, support informed treatment decisions through science and education, and drive sustainable growth across our Duchenne portfolio. We remain confident in the long-term opportunity for Elevitus and the strength and durability of our PMO franchise. Most importantly, we remain deeply committed to transforming what is possible for patients and families living with Duchenne and bringing that same commitment to patients across other serious rare diseases. Thank you, and with that, I'll turn the call over to Louise. Louise?

Thanks, Patrick. And let me add my welcome mic. We're happy to have you on board. As we move into the few last months of 2026, we remain excited by the science that underlies our rare disease portfolio and the data we're preparing to share with you soon. Before turning to the individual programs, I want to briefly explain how we think about our next-generation RNA platforms. Our strategy is built on a simple premise, biology first. Rather than applying one delivery approach across all tissues, we select the receptor and delivery architecture that is intended to best address the key biological barrier in each disease. In muscle, that means leveraging alpha-V beta-6 integrin targeting, which was selected for its strong muscle exposure and delivery characteristics. In the CNS, where the dominant barrier is transport across the blood-brain barrier, will use a unique transferrin receptor-based approach. Across both settings, our goal is the same, to move beyond systemic exposure and achieve productive intracellular delivery, target engagement, molecular correction, and ultimately, the potential for functional benefit. Combined, we believe this approach will distinguish our therapies from others in earlier and later stage development. This is also where siRNA biology is important. SIRNA uses catalytic, multi-turnover risk activity that can continually silence. We believe this enables deeper and potentially more durable suppression of disease-causing RNA than approaches that rely on antisense mechanisms that require RNase H, a rate-limiting enzyme. Together, biology-driven delivery and catalytic SIRNA potency creates the foundation for our belief that these programs have the potential to be best-in-class. Building on the positive STAD data from our lead programs to treat FSHD and DM1, we remain on track to announce interim results from a multi-ascending study or a MAD study in the second half of this year. We believe these programs are differentiated through a unique targeting mechanism and high muscle bioavailability, positioning them as potential best-in-class therapies compared to more mature competitive programs in this space. To remind you, Data from our readout this year showed high muscle concentration with alpha-V-beta-6 and a strong safety profile. Beginning with SRP1001, which is our siRNA-based treatment designed to reduce or knock down the production of the DEX4 protein in skeletal muscle in patients living with FSHD. FSHD is caused by abnormal activation of the DEX4 gene, leading to expression of the DEX4 protein. Bux4 is a transcription factor that affects the expression of multiple genes within muscle. It's normally expressed during embryonic development, but when reactivated later in life, it creates a toxic intracellular environment that contributes to muscle degeneration. This underlying pathology is well understood, and the pathological role of Bux4 in the progression of the disease is well accepted. Our therapeutic thesis is that deeper Dux4 knockdown in muscle should translate into greater molecular correction and, over time, the potential for improved functional outcomes. The MAD data we plan to share will include safety, PK, Dux4-related gene panel, circulating Dux4-related biomarkers, PK, and preliminary functional assessments. Importantly, because FSHD is a slow, progressive disease, and this is An early study including six months of follow-up, the objective is not to definitively demonstrate functional benefit at this time given the trajectory of the disease. Rather, the goal is to establish the biological chain from tissue exposure to target knockdown to molecular biomarkers known to drive the underlying pathology of the disease and also to select an appropriate dose to take on to the next stage of development. In summary, our goal is to generate the highest levels of knockdowns that improves biomarkers and leads to best functional outcomes. Confirming our ability to safely dose escalate and deliver a drug with proven biological efficacy efficiently to the target tissue would strengthen the evidence supporting SRP1001 as a potentially best-in-class treatment for FSHD and provide an important foundation for our discussions with FDA as we prepare to advance a registrational study. Moving on to DM1. SRP1003 is our siRNA-based treatment for DM1 designed to target and knock down or silence the DNPK mRNA and target cells. The early data we generated for DM1 is important for two reasons. First, our preclinical models are predictive of what we have seen in the clinic with respect to muscle concentration. Of note, an increase in plasma exposure has translated into enhanced dose-dependent delivery to the muscles. resulting in robust target engagement. And second, the DNPK knockdown observed to date has been directionally strong and supports the potential of siRNA to address the root molecular driver of disease. As you are aware, DMY is driven by an expanded CUG trinucleotide repeat in DNPK transcripts, causing mutant DNPK mRNA to accumulate in the nucleus and disrupt normal RNA splicing. As a result, for any therapy to be therapeutically effective, it must reach the target tissue, enter the cell, and reduce nuclear-retained DNPK RNA. SRP1003 is being developed to achieve exactly that, with the goal of driving downstream splicing correction. The results we plan to share from the MADS study will include safety, serum and muscle PK, DNPK knockdown, ASI22 splicing index, and VHOT analyses. The importance of these results, should they be positive, will differentiate SRP1003 as a best-in-class treatment for DM1 and offer a clear path to a registration study. It's important to note that our FSHD and DM1 programs demonstrate why we believe delivery efficiency is a primary competitive advantage. The key differentiator is not simply reaching the bloodstream. It's reaching enough muscle fibers, maintaining exposure long enough, Achieving sufficient intracellular S-biRNA concentrations and driving meaningful target knockdowns in the nucleus. Further, our non-clinical data has shown that targeting integrin receptors via small peptides leads to enhanced skeletal muscle uptake compared to using a much larger TFR1 antibody-based approach. It's also important to note that based on data to date, our alpha-V-beta-6 integrin targeting ligand provides superior muscle concentration Thank you for joining us. leads to a greater potential for ligands targeting alpha-V, beta-6 to drive significantly higher muscle uptake than TFR1. These delivery characteristics help establish the rationale for advancing SRP1001 for FSHD and SRP1003 for DM1 in first-in-human studies and continue to support our confidence in the platform. In summary, we believe Proactive's next-generation RNA platform is differentiated by biology-driven tissue targeting Our focus is on connecting the full chain from tissue delivery to target engagement to molecular correction and ultimately to the potential for functional outcomes. We are applying the same biology first framework to our CNS programs. Our Huntington's program is ongoing, having dosed its first patients earlier this year. In these programs, our receptor selection is driven by the biological requirement for transport across the blood-brain barrier. If successful, the early CNS data would provide important validation of our transfer and receptor-based blood-brain barrier delivery approach. Our second-generation DM1 program is the first example where we aim to impact the CNS in addition to muscle to address the significant unmet need. We look forward to sharing this data as soon as it becomes available. Now turning to Alevitus. We were pleased to announce in March that screening and enrollment were underway in cohort 8 of Endeavor for study SRP 9001-103. To remind you, the purpose of cohort 8 is to assess prophylactic serolimus treatment as part of an enhanced safety protocol during treatment with Alevitus in non-ambulant individuals with Duchenne. Data from cohort 8 will be used to determine whether administering serolimus prior to and after Alevitus infusion can help reduce acute liver injury or ALI, a known risk associated with AV gene therapy as a class effect. The cohort is enrolling approximately 25 participants in the United States who are non-ambulatory and doses currently underway. As a reminder, the immunosuppression regimen will include 14 days of peri-infusion serolimus prior to Levitas administration and will continue for 12 weeks after Levitas administration. The evidence base continues to build. As previously shared, there have been independent published reports on the use of serolimus to mitigate ALI with elevatus. Dr. Soslow and colleagues very recently published a study in human gene therapy demonstrating that none of the patients treated with prophylactic serolimus had ALI. We will also present what we believe are encouraging interim safety data from our Phase 4 Endure study at the Neuromuscular Study Group meeting in September. that showed zero incidence of ALI in patients treated prophylactically with serolimus. We expect to fully enroll the Endeavor Cohort 8 study by the end of 2026. Based on observations that our study investigators are dosing participants sequentially, we now expect 12-week data from the full cohort in the first quarter of 2027. Further, we continue to plan to meet with FDA in early 2027. In addition to safety, we continue to build the evidence-based At the Neuromuscular Study Group meeting, key denoted disclosures include microdystrophin and muscle MRI correlations with function, next, the impact of treatment delay modeling, the Endure Phase 4 interim safety and liver safety, U.S. post-marketing safety, and finally, the promised mobility outcomes versus external controls. At the World Muscle Society meeting, we will highlight expression and safety data in the level of treated patients under four, along with encore presentations of those work, three-year outcomes, cardiac functional data, pooled safety, and early intervention preclinical data. We look forward to sharing this data with the community. Moving now to Amandus 45 and Vyondus 53, our exon skipping therapies to treat Duchenne. At the end of June, we were excited to announce that the FDA accepted our supplemental new drug applications for both therapies, assigning Purdue for target action date of February 28, 2027. The SNDA submissions seek conversion of the accelerated approvals of Amondus 45 and Biondus 53 to traditional approvals. The applications are supported by the data from the Essence Confirmatory Study, as well as substantial published real-world evidence and the favorable and consistent safety profiles of both exon skipping therapies. We look forward to sharing important updates with you in the coming months, including readouts from our FFHD and DM1 MAT studies, proof of biology from our Huntington's Disease Program, and data from the Endeavor Cohort 8 study. Thank you, and I'll now turn the call over to Ryan for an update on our financial performance. Ryan?

Thank you, Louise, and good afternoon, everyone. We delivered a strong financial performance in the second quarter, and we are pleased with the continued operating discipline reflected across the business. Our goals underscore the durability of our commercial D&D franchise, the progress we are making with our pipeline, and our ability to fund our most important commercial and R&D initiatives In my remarks, I'll walk through the quarter's key financial highlights and how we are positioned for the second half of 2026. Beginning with second quarter revenue performance, total revenues for $401 million had decreased by 34% year-over-year, driven by the decrease in net product revenues, primarily levitas, due to lower demand. Total revenue in the quarter included $73 million of collaboration and other revenues, assisting primarily of contract manufacturing revenue from our partnership with Roche. Through the first half of the year, we've now reported $659 million in total net product revenue and over $1.13 billion in total revenue. Due to year-to-date total revenue decreased 17% compared to prior years, driven by lower elevative product revenue, partially offset by higher collaboration and contract manufacturing revenue. Moving next to growth margin. Total cost of sales for the quarter were $149 million, a decrease of 2% compared to the prior year period. The change over a year is reflective of lower cost of goods due to a decrease in our product sales, partially offset the higher cost of goods related to contract manufacturing revenues. On a year-to-date basis, total cost of sales were $248 million, a decrease of 11% year-over-year, driven by similar dynamics. Gross margins on net product revenues were 75% in the quarter and 78% for the first half of the year. Operating expenses continue to reflect our focus on disciplined cost management. Combined R&D and SG&A expenses in the second quarter on a GAAP and non-GAAP basis were $199 million and $165 million, respectively. Non-GAAP expenses in Q2 decreased 44% compared to the prior year period, reflecting the benefit of our cost-restructuring initiatives and the prioritization of our promising SR&A programs in our R&D portfolio. First half combined R&D and S&A expenses on a GAAP and non-GAAP basis were $462 million and $388 million respectively. Year-to-date non-GAAP expenses were down 66% compared to the same period prior year, also driven by the restructuring and pipeline reprioritization, as well as the Arrowhead Collaboration upfront expense recognized in the prior year. This operating discipline translated into meaningful profitability for the quarter. We delivered GAAP operating income of $13 million and non-GAAP operating income of $86 million. For the first half of the year, GAAP and non-GAAP operating income came in at a robust $372 million and $484 million, respectively. In addition to the results I just highlighted, our GAAP results include a $39 million litigation contingency charge to potentially resolve certain outstanding patent claims. From a balance sheet perspective, we ended the second quarter with $945 million of cash and investments, growing $197 million from the prior quarter. The robust cash increase in the quarter is a result of our strong operating performance and includes a receipt of $40 million from the Roche commercial sale milestone earned in Q1. For the first half of the year, if you exclude $250 million of collaboration payments made to Arrowhead in the first quarter, our base business has generated over $240 million in cash. In closing, I'll provide color on our outlook for the second half of 2026. First and foremost, we remain focused on discipline execution and prudent capital allocation as we advance our commercial and pipeline priorities. As you heard earlier on the call, we have narrowed our net product revenue guidance to between $1.2 and $1.3 billion. It's a midpoint of this range and appropriate reference. In addition, we are revising upward our total collaboration and other revenue guidance to between $550 and $600 million which is an increase of $75 million from the midpoint of our previous guidance. This is driven primarily by higher contract manufacturing revenues. I'd like to highlight for modeling purposes, this increase in expected contract manufacturing revenues will also result in a roughly equivalent increase in cost of goods or products sold to Roche. Now moving to expenses, given we are halfway through the year, we are tightening our non-GAAP office guidance to $800 to $850 million, the low end of our previous range. And finally, from a capital perspective, looking back at the last 12 months, we have reset our cost structure, fulfilled our large collaboration obligations to Arrowhead, and refinanced the majority of our 2027 debt, while today's business generated nearly $400 million in cash. On a forward-looking basis, given the strength of our execution, we believe our medium-term liabilities and remaining 2027 notes are well-funded, and we remain in a strong financial position to fund our promising pipeline using cash flow from our business, And with that, I'll turn the call back to Mike for Q&A. Mike?

Thank you, Ryan. Operator, can you please open the call for Q&A?

Thank you. At this time, we will conduct the question and answer session. To ask a question, you'll need to press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. We do ask that you please limit your questions to one question. Please stand by while we compile the Q&A roster. Our first question comes from the line of Anupam Rama of JPMorgan. Your line is now open.

Hey, guys. Thanks so much for taking the question. And hi, Mike. How are you? Congrats on the new gig, man. So when you look at the pipeline, What really excites you about what you have going on in the pipeline? Is it something particular about the Arrowhead products or something like what Cohort 8 could do for the Elevitus franchise? I was wondering if you could expand on that. Thanks so much.

Certainly. Thanks for the question, Anupam, and I'm very happy to be here. There are a number of things that excite me about the pipeline, and so maybe I'll talk about them in two parts. The cohort eight data, I think, are very promising. The potential for serolimus. to improve benefit-risk in the non-ambulatory population I think can have a big impact over time. Obviously, we're still in the data generation phase there, and as we said, we expect to complete that cohort's enrollment by the end of this year and have data in the first quarter of next year, but I think that's something that we're very much looking forward to. But when I look at the earlier pipeline and the siRNA programs that we're advancing, I believe they have tremendous potential. Thank you very much. and when I look at both the preclinical data and the early clinical data, I see both the delivery aspects of the technology performing very, very well with dose-dependent increases in muscle concentration up to the highest dose tested in our SAD studies without any dose-limiting toxicities. We have very potent RNA silencing technology, as Louise pointed out, Thank you very much. Thank you for taking our question. Congrats on the progress and congrats on the new role, Michael.

Welcome to Sarepta.

A question for Michael. Based on our discussions, there is a high number of investors who are very interested in the DM1 and FSHD program, but are hesitating to underwrite the DMD pipeline risk. Although I understand it may be a little early for this question, but how are you thinking about the potential separation of the two businesses, the DMD pipeline and the DM1 FSHD programs? Thank you.

Thank you for joining us. increased duration of ambulation, reduction in progression of cardiac and pulmonary disease, and even overall survival across various aspects of our DMD portfolio. We think those programs are a real asset to the company. When we look at their performance, we see very solid, very stable, and very durable performance, which I think is very consistent with that benefit that is being delivered. and, importantly, the revenue that those programs generate is what allows us to drive the earlier parts of our pipeline, the SIRNA programs in particular. And so they're really very complementary to each other. And I think as we move through the year, we have a number of data readouts that will clarify the The long-term role of our D&D portfolio, which I think is very promising and will have a very bright future, as well as turnover new important data cards on the SIR&A pipeline, I think can open up some very new and very important venues for the company's future growth. And so, again, I think those areas are very synergistic.

One moment for our next question. My next question comes from the line of Brian Abrahams of RBC Capital Markets. Your line is now open.

Hey, good afternoon. Thanks for taking my question, and Mike, congrats on the new position. Welcome to this reputee. On the expense side, it looks like you've lowered your OPEX guidance for this year, and I think you've talked in the past about the 800-ish range being a good steady state to think about. I'm curious if you could talk a little bit more about the puts and takes around the OPEX run rate here. Is there any further wiggle room? And I guess how will resonance of the Elevitus commercial efforts as well as the competitive dynamics for the Exxon Skippers potentially influence how you think about long-term OPEX? Thanks.

Ryan, do you want to take that?

Yeah, absolutely. Thanks for the question. Yeah, so we've talked previously around we're very, very comfortable in that $800 and $900 million range in terms of OpEx, both being able to fund our commercial initiatives and to advance our pipeline. And as you saw, you know, we believe in the sort of durability of the CMD franchise. So although acknowledging that competitors are in the mix, we think there's high value in both our Excellent Skipping and Gene Therapy Programs. And so we're continuing to invest in that durable B&B franchise. And then given the cash flow generation profile of our company, we feel really confident we can advance the SRNA programs to invaluable inflection points. And that being said, we continue to be very prudent about capital allocation. We're going to, you know, One moment for our next question.

Our next question comes from the line of Andrew Tsai. Jeffrey, your line is now open.

Hi. Thanks. Good afternoon. Congratulations, Mike. So I have a question about the regulatory strategy for the SRNA programs because given you guys have the desire to start pivotal studies, can you maybe talk about your rate of thinking and whether you plan to pursue accelerated approval or full approval for both indications and What do you envision your primary endpoint to be, ultimately? Thank you.

And I'll ask Louise to address that.

Sure. Thanks for the question. Now, for both FFHD and DM1, in terms of the regulatory pathway, as we've described before, the way we've thought about it and set it up is that we have the ability to apply for both accelerated approval and traditional approval depending on the regulatory framework at that time, the landscape, and the data that's generated. In terms of the outcomes that we will use in our phase three trial, that's really what the MADS study readout will help us inform of that. Obviously, in these early studies, we were looking at a variety of endpoints and evaluating all of them, and it will be a data-driven discussion. We'll also be looking at the landscape in general, It's a great opportunity for both of these communities that there's so much interest in this space and so many developers in this space. And so it'll be both our internal data and the entire landscape that informs our approach to the next phase. And we look forward to having that discussion with regulators.

One moment for our next question. Our next question comes from the line of Ellie Murrell of Barclays. Your line is now open.

Hey guys, thanks for taking the question. And Michael, welcome to Sarepta. Just a clarification on some of your elevatist commentary. You mentioned you saw a quarter-over-quarter increase in elevatist enrollment forms. Just to clarify, are you also seeing an increase in start forms in 3Q versus 2Q? Or if you could just characterize that trajectory. And then in your comments, you said you expect modestly lower elevatist revenue in the second half versus the first half. but more contributions from start forms in 2027. I guess just to clarify, should we be expecting revenues to grow in 2027 from that? Thanks.

So with respect to start forms, I'll say a bit and then I'll ask Patrick to provide some more detail. We're encouraged with the trends that we see. As you know, we spent a good portion of the first half of the year getting our expanded commercial footprint in place and putting our initiatives together. in place in order to have a balanced communication of benefit-risk around the Levitas, and we're seeing those efforts start to take hold. We are seeing improvement in start forms, and we would expect those trends to continue. It's early to be talking about 2027, but we do feel quite confident in the nature of the benefit-risk discussions that we're having and the trends that we're seeing. Patrick, do you want to add a little bit more detail?

Absolutely. What I would say from a commercial perspective is the indicators that we're seeing today are moving in the right direction. Our strategy is set. Our sales team is trained and out there and deployed, and our broader commercial initiatives are fully operational. With the enrollment form activity, it has stabilized and improved. Returning sites are engaging, and we are seeing interest from new sites. I'd say all of this signals that these initiatives are taking hold and strengthening the Even though the associated revenue, it will come, but it's going to take time. And really, the team is just focused on consistent execution and helping those patients progress through the journey.

One moment for our next question. Our next question comes from the line of Yigal Nohamovic at Citi. Your line is now open.

Hi, this is Caroline on CIGAL. Thanks for taking your question. With DM1 and FSHD data approaching, can you tell us what disease characteristics make a target particularly well-suited for the Alpha-V-Beta-6 delivery platform, and what additional muscle diseases could become attractive expansion opportunities if the upcoming data sets are successful? Thanks.

Certainly. Louise, would you like to take that?

Sure. So, for our platform for FSHD and DM1, we're using what really got us excited about working on these indications with the alpha B, beta 6 targeting Y again. And really because of the wide distribution across muscle, and that's why we selected it. We've also talked about the receptors available for high muscle concentration, and that's exactly what we saw translating the preclinical data to early clinical data, is that we were able to achieve high levels of muscle concentration in DM1 and FSHD without dose-limiting toxicity. So really when looking at an indication why the alpha-b beta-6 is attractive is because you are broadly getting high levels of muscle concentration. And so in terms of potential other indications, it's really those affecting muscle diseases with widespread need in terms of the muscle pathology. And so in now speaking to the other part of the equation with siRNA, CM1 and FSHD have very clear Thank you very much. With the alpha-b beta-6, you could target any muscle disease. With the siRNA, we're really looking at gator function toxic diseases where you could get efficient knockdown of that indication. So we're, as you can tell, really excited about this platform generally and the potential of these indications and beyond. Thank you.

One moment for our next question. Our next question comes from the line of Ritu Bharal of TD Cowen. Their line is now open. Good afternoon, guys. Thanks for taking the question, Michael.

Great to have you in the seat. I've got two questions. One is related to just the time lag to revenues for Elevitus. Given you guys mentioned that there is A quarter over quarter increase in demand, but that real revenue increases may not happen until 27. Does this imply that there is a longer time to fill, a longer time in the pipeline until revenue recognition than the previously indicated, I think, five to six months? Is that the lag we should be modeling going forward? And then with your cohort eight data in Q1 of next year, will you have Expression data as part of that top line release beyond just liver safety? And if so, what should our expectations be both for expression and for liver safety? Thanks.

Thank you. I'm happy to take those questions, and I'll ask Patrick and Louise to provide some additional detail. With respect to the Thank you for joining us.

And Louise, do you want to take the question about the timing of expression data in cohorting? Sure. Sure.

So you asked about the endpoint. So we expect to have the data on ALI. The primary goal of that study was to reduce that. We are collecting the biopsy data. And at this point, I'm not sure about the timing of that data, but the primary goal of that readout, especially with taking data to the agency, will be for the ALI. And we will produce the biopsy data. I'm not sure on the timing of that. at this point.

One moment for our next question. Our next question comes from the line of Mike Old of Morgan Stanley. Your line is now open.

Good afternoon. Thanks for taking the question, and let me add my congratulations to Mike as well. Maybe just with respect to the RNA data updates expected later in the second half, Should we expect those more towards year-end, and will you share those updates together, or do you plan to separate them out? If I remember correctly, I think FSHD may be a little bit ahead of DM1. Thanks.

Well, we've said that those data will be available later on in this year, and at this point, we're not able to be more specific about the timing. We're going to look at each data set as they become available, and make them public in an appropriate fashion. So I really can't comment today as to whether it would be at the same time or staggered. It depends on the availability of those data. But again, both are expected in the second half of this year, and we're on track to meet that timeline. Louise, is there anything you'd like to add?

No, that's correct. Thank you.

And maybe just very quickly, just to add, Mike's exactly right. We do think about these programs as separate programs, though. Obviously, the timing on this ad data, they were very close and it made sense to release the data at the same time. But just generally speaking, we do think of these programs separately. So to Mike's point, when they become available is likely when we would release it. That's how we're thinking about it.

One moment for our next question. Our next question comes from the line of Salveen Richter of Goldman Sachs. Your line is now open.

Great. Thanks for the question. This is Matt Ong for Salveen. Maybe building on a prior question, could you provide any more color on the metrics beyond star forms that you are seeing that support deeper elevatous penetration in the ambulatory patients? and how are you thinking of the longer-term trajectory now? And then also, how might you be able to leverage some of your efforts here to support non-ambulatory use if that's eventually included back in the label? Thank you.

Absolutely. Our strategy is set, and as I mentioned, the sales team is out there. They've been trained, they're deployed, and the broader commercial initiatives are fully operational. So we're seeing enrollment form activities stabilize and improve We've got returning sites that are reengaging, and we're seeing interest from new sites. We're also seeing a directional alignment between healthcare provider engagement and enrollment form submission. So when our sales team goes in and speaks with an HCP, we see enrollment forms result after. As I've mentioned, in some cases, as soon as 30 days after that engagement. Those signals to us that those initiatives that we put in place are starting to take hold. and it's strengthening our patient pipeline. Even though the associated revenue contribution, it's going to take time and our team is just focused on consistent execution and helping those patients progress through the journey.

One moment for our next question. Our next question comes from the line of Barron Ammon of Piper Sandler. Your line is now open.

Yeah, hi guys. Thanks for taking my questions. Maybe three-parter for me. On Amandus and Beyondus, FMDA, has the FDA indicated there are any plans to hold an advisory committee meeting? So that's the first question. Second question on FSHDs, there's a direct transcriptional target of Dux4 that apparently correlates to a clinical disease severity. I wonder if you're looking at that in the current trial. And then from the last one on cohort 8 data, is there potential to revise the LGMD GMPB programs after those cohort 8 data? Thanks.

Okay, I'll start off and then I'll pass to Louise. With respect to the Amandus and Ziondis reviews, the FDA has not indicated at this time that they have an intent to schedule an advisory committee. Obviously, they can make that decision at any point, but to date they have not made any indication that they intend to do so. Louise, do you want to take the questions about the endpoints?

Sure. The second question was on FSHD and the Dux4-related genes, and so certainly we're looking at both a downstream Dux4 gene panel, but then also I think your point was around the Dux4 biomarkers, and so our team is looking at multiple circulating biomarkers and evaluating them. Right now, so both validating the assays and then looking at them in our models. And so certainly that is something that we are actively looking at because having a circulating biomarker is a huge advantage in these indications. And then I believe the last question is on the limb girdle pathway following cohort 8 data. And that's exactly right. So for LGMD2E, as we've discussed before, Right now, we're on clinical hold, and in order to get off clinical hold and potentially submit the BLA, that's based on the cohort eight data, as we've discussed with the agency. So, as soon as we have that data, we'll be able to discuss the pathway to submit the BLA with FDA following that data as well.

One moment for our next question. Our next question comes from the line of David Home of Village Bank. Your line is now open.

Hi there. Thanks a lot for taking my questions. So I want to ask about the PMO franchise and your perception of the durability there. And in particular, how should we think about modeling the franchise next year, especially with Exondus, where we have a potential market entry of a competing Exxon 61 skipper? Thanks a lot.

I'll start and probably pass it to Patrick for a little bit more detail. We have a tremendous amount of confidence in the durability of the PMO franchise. This is a franchise that has a very long track record, 10 years for the first approval, and has delivered benefit to patients over that period of time. There's extensive Real-world evidence supporting benefit as well as supporting a favorable safety profile. And so we feel that we are in a good position to enter a competitive market and to maintain momentum in that franchise. It's a bit early to predict exactly how those dynamics will play out from a modeling perspective, but we think any impact that competition would have would likely take some time to become visible. One has to overcome a number of hurdles when one enters a market like this. There are reimbursement pathways that need to be established patient assistance programs that need to be put in place if the sponsor, in fact, intends to do that. For example, with our PMO franchise, we have home infusion support and a number of things that contribute in addition to the overall benefit delivered to the very high rates of adherence that we have observed, 90% or greater. And so we would expect that impact of competition, if it were to come to be later on in 2017, Patrick, do you want to add any additional color?

You covered it very well. Our position is grounded in that decade of experience supporting patients, families, physicians, and those treatment centers. As you mentioned, we've got a body of real-world evidence, established safety experience, adherence rates exceeding 90%, and we've got a team that's Very well versed in working through any reimbursement challenges with the providers and the institutions in order to get patients authorized and reauthorized and keep them on therapy. And so all of that points to the mature infrastructure that we have and we're going to lean into as we support our patients.

One moment for our next question. Our next question comes from the line of Mitchell Kapoor of HC Wainwright. Your line is now open.

Hi, this is Jaydon from Mitchell. Thanks for taking our question. So going back to Amandus and Beyondus, regarding those SMDA submissions, do you have any thoughts on timing for converting Exondus to full approval? As you guys spoke about, as of next month, it'll have been on market for a full decade, but it's been on accelerated approval that whole time. And additionally, can you speak a bit on the recent Capricor adcom meeting? Do you see this increased scrutiny of post-hoc data reevaluation as a negative read-through for Amandus and Beyondus, given that the data did not achieve traditionally accepted statistical significance in the trial? Thanks.

So, with respect to the Capricor adcom, I think the issues that were discussed at that adcom were particular to the package that Capricor brought forward and the FDA's review of that package. Obviously, we don't comment on other sponsors' review process, but we don't see read-through to our program. When we look at the application's They are supported not only by the clinical trial data but by extensive real-world evidence, and we believe together those present a strong package for conversion to traditional approval. With respect to the strategy for Exondus, Louise, would you like to take that?

Sure. So for Exondus, We don't have a confirmatory study as part of that. We have a post-marketing commitment, which is our mission study, which is a dose-ranging study. And that study will be done by the end of this year. And so following that study, we'll have discussions with the agency in conjunction with the Verandas and Amandas as well. And so that's where we're at in terms of the potential conversion of Agrandas to traditional approval.

One moment for our next question. Our next question comes from the line of Andy Chen of Wolf Research. Your line is now open.

Hey, thank you for taking the question. Welcome, Michael. Regarding the math data in DM1 with the functional endpoint, I think, Louise, you mentioned that the goal is not, or the primary goal is not to establish functional efficacy with the dataset. Can you please clarify the reason behind it? Is it because you don't have visibility yet and the sample size is too small for you to make a conclusion? Or is the empirical result tracking in such a way that you can't conclude that it's better than competition? Thank you.

Louise, do you want to address that?

Yeah. So for FSHT, it's really around the timing of the data. So as I mentioned, FSHT is a very slow, progressive process. and the data is at six months, so we would not expect to see a strong signal at six months, so it's really about the timing of that. James, would you like to add anything around the disease itself and the way we think about functional outcomes in this indication?

I mean, I think you covered it really, Louise. FSHD is a slowly progressive disease. We expect the treatment here to improve Symptoms we expected to stabilize the disease, similar paradigm to DMD, and we need time for the disease to progress to show the therapeutic effects of stabilization. This is very much in line with other developers for the advances in the field as well.

One moment for our next question. Our next question comes from the line of Brian Scorney of Baird. Your line is now open.

Hi, this is Luke on for Brian. Thanks for the question and also wanted to offer my congrats to Michael. So on the Huntington's program, I guess you have an idea of when we might see the phase one data. And can you remind us if you're measuring protein knockdown and if you think the study could support some initial biomarker proof of concepts? Thanks.

Luis, do you want to take that?

So we expect the first proof of biology data early next year. And really, this is early single ascending dose data. And what we're looking for in this study is safety and then early signs of efficacy. So are we getting past the blood vein barrier? And to do that, we're looking at knockdown and pharyngeal tension. That'll be in the CFPAP. So that's what we'll be looking for in terms of validation of the platform, along with safety and the ability to dose escalate.

One moment for our next question. The next question comes from the line of your Zoo of Wells Fargo Security. Your line is now open.

Oh, hey. Thanks for taking our questions, and congrats to my honor to be in the CEO role. A question on Cohort 8. Is the ALI data All that's needed from FDA to make a decision, and if that's the case, could the decision be a reinstate the indication? And another question on the Biondis and Amondis, the SNDA, the review time seems to be eight months. I was wondering, is that... It doesn't seem like either priority or standard review. Could you talk about what timeline is that and what might be the implication? Thanks.

Certainly. So with respect to Cohort 8, our strategy is to complete Cohort 8, and as soon as we have the 12-week data completed, approach the FDA to discuss the regulatory path. So we can't comment on that regulatory path today, but we will be engaging with regulators with data in hand to define that path. And we believe that the cohort A data, when they are available, together with other data sources like Endure, can make a compelling argument for benefit-risk in this population. But obviously that will be discussed with regulators, and the exact nature of the path will be defined at that time. With respect to the Amandus and Bionis review, it is a standard review.

One moment, Arnaud. Question. Oh.

I just want to clarify, it was 10 months from submission, not by.

Our next question comes from the line of Tazin Ahmad of Bank of America. Your line is now open.

Hi, thanks for squeezing me in. I just wanted to clarify a comment that you made about the potential for an accelerated path for, let's say, DM1 in the future. As it relates to the competitive landscape, if, let's say, one of the programs that's ahead of you in development, let's say Novartis, is able to get an accelerated path, do you think that would lessen the chances that Sarepta could have, even with compelling data, to get an accelerated path as well?

Thanks.

Louise, would you like to take that?

Sure. Certainly, as I mentioned, we'll evaluate the regulatory landscape as we proceed, and our study is designed to be ready and available for both accelerated or traditional. Certainly, having a traditional approval makes things, changes the landscape in terms of accessing an accelerated approval, and so It'll be facts and circumstances in terms of both the landscape and then where our data is well, and so we'll be looking at both to define that pathway, and it'll come out of discussions with the agency when we do so.

Yeah, so I agree with Louise. The only thing I would add or perhaps emphasize is that these will be data-driven decisions, so it will depend on the nature of an approval in the space if that happens. and the particular strengths of our data relative to that approval. But we will be prepared to go forward for either an accelerated or a traditional pathway, depending on what is most appropriate at the time.

One moment for our next question. Our next question comes from the line of Joe Schwartz of Learing Partners. Your line is now open.

Hi, thanks for taking my question. Welcome, Mike. We appreciate you joining at such an important time and look forward to seeing how you shape the company's future. For the next SRP 1001 and 1003 updates, what quantitative benchmarks does each program need to clear to justify pivotal advancement rather than continued exploration?

Louise, would you like to take that?

Sure. We're looking for... Two things out of these studies, or multiple things. We're looking for the ability to dose us going safely, so get through a dose that's appropriate for the phase three with very strong muscle concentration and significant knockdown. So, as I mentioned during my opening remarks, we want to get the highest levels of knockdown that we can in order to affect the biomarkers and also predict functional improvement. And that's all benchmarking back to our preclinical data. And so, we're looking for also concentration, knockdown, and the ability to dose escalate safely without any safety signals. And so that's what we're looking for out of these two studies.

Our next question comes from the line of Yunzong of Whitebush. Your line is now open.

Hi. Good afternoon. Thank you very much for taking the questions. So the first question I wanted to confirm because I thought the original guidance was for data from cohort eight to be available by year end. So was there a delay in terms of the patient enrollment and did you have any challenge to enroll non-ambulance patients given the safety concerns? And secondly, can you remind us the efficiency of your Huntington's disease program candidate to cross the blood-brain barrier? And in terms of knock-down efficiency, What magnitude would you like to see, please?

Thank you. Louise, would you like to take those?

Sure. So for the cohort 8 enrollment, and so in terms of enrollment, we're seeing the study progress well. We are seeing investigators dose sequentially their patient sources in parallel. And so when we looked at the timing of when we would have the 12-week data, it would be available in Q1 of next year. And so when we have the The complete 12-week data from the 25 patients that will be in Q1. So that's the reason for the data availability for cohort 8. In terms of Huntington's program, the knockdown that we're seeing is really based on our preclinical models, and that's both in murine models as well as the non-human primate model, where we saw knockdown levels as high as 80%. And really what got us excited about this is the ability to knock down in the deep brain I'm showing no further questions at this time. I would now like to turn it back to CEO Michael Severino for closing remarks.

Thank you, Operator, and thanks to everyone on the call for your time and attention today. As I said in my opening remarks, my first few weeks with this talented team reinforce my view that we have a bright future ahead of us and my confidence in the potential of Sarepta has only grown. We have four marketed products that make a real difference in patients' lives today. We have a compelling pipeline of siRNA therapeutics that will drive our future growth, and we are executing from a position of financial strength. with the ability to advance our pipeline and initiatives independently as evidenced by our strong balance sheet and operating profitability. A number of important catalysts are on the horizon, which we believe can unlock long-term value for patients and shareholders alike. We appreciate your continued support and look forward to updating you on progress in the months ahead. With that, we can end the call, and I hope everyone has a very nice evening.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.